Tuesday, 4 October 2011

Tax Planning in Spain


For tax planning read Tax saving

·        QROPS and QNUPS
·        Offshore Trusts
·        Understanding residency and domicile


It’s an odd fact, but true, that a country like Spain can be regarded as a tax haven with careful planning and expert advice. QROPS, QNUPS and establishing Offshore Trusts are just three examples of effective tax planning.

Tax Planning for Spanish Inheritance Tax (ISD) is a specialist subject and is covered in some depth at the following post;
http://expatsfrombritain.blogspot.com/2011/07/spanish-inheritance-tax-isd.html .Please remember that ISD is payable by both residents and non-residents in Spain.

When I was planning to move to Spain, a few years ago, I came to the conclusion that, in tax planning terms, the UK was a good place to accumulate wealth, including pensions and Spain was good for retiring and spending the accumulated wealth. The same is true to some extent, even though the UK Budget 2009 (Labour) and the 2010 version (Coalition) may have changed some pension rules.

Many firms of advisers will offer a financial review based on all circumstances. It can be very misleading to deal with pensions, tax and even mortgages in total isolation from other financial issues. For example, I was recently told about a lady who had a problem with her mortgage and the solution was found by imaginative use of her pension. Email me for links to a professional adviser.

Effective tax planning has three key issues;

  • Residential status and domicile
  • Where your assets are held
  • The nature of your current and future income

Last year,I came across a financial adviser who could not even distinguish between residency and domicile, when I checked the advice he gave one of my readers I was horrified. There are still advisers giving misleading, bogus and poor advice.

It is imperative that you seek out a professional adviser. I can help if you need me to recommend the right advice. Email

Spain can even be a tax haven but you will only benefit through sound professional advice.

It is also important to understand the distinction between tax avoidance and tax evasion. This is covered in some detail by the following;


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You can write to me with your personal experiences or to be put in touch with my recommended adviser by sending me an email I’m very keen to get your feedback